Warsh’s forward guidance in the spotlight again | Dot plot not officially scrapped | BTC rebound: watch 82,200
My stance is to be cautious about the rebound and not treat the buzz around “the Fed scrapping the dot plot” as an implemented policy. The topic gaining traction on social media is Chair Warsh’s push to scale back forward guidance. Back to the primary source: in his Jackson Hole speech, published on the Fed website on August 28, he did argue for limiting forward guidance in normal times, saying that signaling the interest-rate path in advance can make markets overly reliant on forecasts. But that was a position on communication, not a new decision suddenly announced on October 15. On September 16, the Fed still released its economic projections, including individual policymakers’ projections for the appropriate path of the federal funds rate. So saying “the dot plot has been abolished” goes beyond what the public documents show.
I’m more interested in how this communication philosophy might change trading discipline. If officials provide fewer hints about the path ahead, markets may be more likely to reassess interest rates, the dollar, and risk-asset valuations after data comes out. But “less information” can’t simply be translated into “bullish for BTC,” nor does it necessarily mean a sharp sell-off. Today, the U.S. Bureau of Labor Statistics reported that September final-demand PPI rose 1.3% month over month and 6.3% year over year, reflecting price pressures at the production level. PPI is not a Fed vote, nor is it a guarantee of future CPI or PCE readings. In his speech, Warsh also stressed that policymakers shouldn’t mechanically rely on a single data point—exactly the opposite of traders seeing one headline and betting on the next rate decision.
Let’s cross-check the fund-flow data as well: Farside’s daily table shows net outflows of about $261.4 million from U.S. spot BTC ETFs on October 14. The October 15 row is still pending, so the 0.0 currently shown in the table is not a final conclusion that there were zero outflows today. Keep these two things separate: the communication framework shapes how expectations are formed, while fund flows reflect changes in capital that have already happened. Neither directly proves what caused every candle today. The latest official BTC purchase announcement on Strategy’s website was for 250 BTC on October 12; social media speculation is no reason to announce another purchase on the company’s behalf.
The market’s initial reaction was a dip followed by a recovery. At the time of writing, Kraken BTC/USD was around $82,159, with an intraday low of $79,709, a high of $82,289, and an open of $81,576. It has climbed back above $80,000 and is now near the intraday high. I view $80,000 as a psychological battleground between bulls and bears, and $82,200–$82,300 as the short-term confirmation zone. If price breaks above it but can’t hold, this could just be a round of short covering. Conversely, if the hourly close falls back below $81,500, the rebound is clearly losing steam; if price then breaks below $79,700 and fails to reclaim it on a bounce, my current recovery thesis is invalidated. If the Fed officially changes how it publishes its projections in the future, I’ll update my view based on formal Fed documents, not social media retellings.
If I were trading this myself: I’d stay out for now, and only consider an unleveraged spot long, with a position size of 0%. Only if an hourly candle closes above $82,300 and the following hour’s pullback holds in the $82,000–$82,300 range would I test a long with no more than 0.5% of total capital. I’d take half off at $83,200 and close the rest at $84,200. After entering, if an hourly candle closes below $81,800, I’d cut half; below $81,100, I’d stop out entirely. If I haven’t entered and price first loses $80,000, I’d immediately cancel this rebound-following plan. The noisier the macro news gets, the smaller the position should be. Never use high leverage to guess what the Fed will say next.
#WarshPushesToScaleBackForwardGuidanceAndDotPlot #BTC
This is for personal market observation only and does not constitute investment advice.
My stance is to be cautious about the rebound and not treat the buzz around “the Fed scrapping the dot plot” as an implemented policy. The topic gaining traction on social media is Chair Warsh’s push to scale back forward guidance. Back to the primary source: in his Jackson Hole speech, published on the Fed website on August 28, he did argue for limiting forward guidance in normal times, saying that signaling the interest-rate path in advance can make markets overly reliant on forecasts. But that was a position on communication, not a new decision suddenly announced on October 15. On September 16, the Fed still released its economic projections, including individual policymakers’ projections for the appropriate path of the federal funds rate. So saying “the dot plot has been abolished” goes beyond what the public documents show.
I’m more interested in how this communication philosophy might change trading discipline. If officials provide fewer hints about the path ahead, markets may be more likely to reassess interest rates, the dollar, and risk-asset valuations after data comes out. But “less information” can’t simply be translated into “bullish for BTC,” nor does it necessarily mean a sharp sell-off. Today, the U.S. Bureau of Labor Statistics reported that September final-demand PPI rose 1.3% month over month and 6.3% year over year, reflecting price pressures at the production level. PPI is not a Fed vote, nor is it a guarantee of future CPI or PCE readings. In his speech, Warsh also stressed that policymakers shouldn’t mechanically rely on a single data point—exactly the opposite of traders seeing one headline and betting on the next rate decision.
Let’s cross-check the fund-flow data as well: Farside’s daily table shows net outflows of about $261.4 million from U.S. spot BTC ETFs on October 14. The October 15 row is still pending, so the 0.0 currently shown in the table is not a final conclusion that there were zero outflows today. Keep these two things separate: the communication framework shapes how expectations are formed, while fund flows reflect changes in capital that have already happened. Neither directly proves what caused every candle today. The latest official BTC purchase announcement on Strategy’s website was for 250 BTC on October 12; social media speculation is no reason to announce another purchase on the company’s behalf.
The market’s initial reaction was a dip followed by a recovery. At the time of writing, Kraken BTC/USD was around $82,159, with an intraday low of $79,709, a high of $82,289, and an open of $81,576. It has climbed back above $80,000 and is now near the intraday high. I view $80,000 as a psychological battleground between bulls and bears, and $82,200–$82,300 as the short-term confirmation zone. If price breaks above it but can’t hold, this could just be a round of short covering. Conversely, if the hourly close falls back below $81,500, the rebound is clearly losing steam; if price then breaks below $79,700 and fails to reclaim it on a bounce, my current recovery thesis is invalidated. If the Fed officially changes how it publishes its projections in the future, I’ll update my view based on formal Fed documents, not social media retellings.
If I were trading this myself: I’d stay out for now, and only consider an unleveraged spot long, with a position size of 0%. Only if an hourly candle closes above $82,300 and the following hour’s pullback holds in the $82,000–$82,300 range would I test a long with no more than 0.5% of total capital. I’d take half off at $83,200 and close the rest at $84,200. After entering, if an hourly candle closes below $81,800, I’d cut half; below $81,100, I’d stop out entirely. If I haven’t entered and price first loses $80,000, I’d immediately cancel this rebound-following plan. The noisier the macro news gets, the smaller the position should be. Never use high leverage to guess what the Fed will say next.
#WarshPushesToScaleBackForwardGuidanceAndDotPlot #BTC
This is for personal market observation only and does not constitute investment advice.